China has condemned new US economic sanctions targeting Iran and trading partners, including Beijing, and said it would take steps to protect its interests.

Foreign Ministry spokesman Lin Jian said China was “firmly opposed” to what it called “illegal unilateral sanctions”, adding that it would use “all necessary measures” to safeguard its rights. His comments came after the US Treasury said on Monday it would widen restrictions on Iran-related financial activity.

US Treasury Secretary Scott Bessent warned that countries working financially with Iran would face isolation. He also said banks and businesses that did not cut ties with Tehran would be affected, describing the package as the most significant financial offensive against Iran.

Bessent did not single out specific states when announcing the measures, but he said US President Donald Trump planned to contact world leaders with requests to end their interactions with Iran’s regime. Asked about Chinese banks in particular, Bessent said: “No one was above the reach of US sanctions.”

China Ties With Iran, and US Frictions

China is the biggest buyer of Iranian oil, though the trade has fallen since the US blockade of Iran’s ports. Lin said cooperation between China and Iran had long been carried out under international law and should not be disrupted.

The announcement also comes ahead of planned talks between Trump and Chinese President Xi Jinping next month, raising concerns in Washington about possible retaliation.

US officials are likely mindful that China processes most of the world’s rare earths and other critical minerals used in the manufacture of many high-tech products. China has already tightened export controls on rare earths as part of previous trade negotiations with the US.

Iranian Officials Say They Are Ready

Iran responded by saying it was prepared for the wider sanctions. Iranian Economy Minister Ali Madanizadeh told state television that Tehran had a two-year plan to manage the impact and said it had “tools” to deal with the situation. He added that Iran had been “waiting for these plans for a long time”.

Bessent said the Treasury had identified financial routes, facilitators and networks used by Iran to evade sanctions in order to trade oil. He said new restrictions would be imposed on nearly 60 entities, individuals and vessels.

The US has branded the action “Operation Economic Outcast”, describing it as an “economic D-Day” against Iran.

Conflict, Ceasefire Expiry and Shipping Disruptions

The move follows almost six months after the start of the Iran war. The conflict has contributed to higher oil prices globally, with Tehran effectively blocking exports through the Strait of Hormuz, a waterway vital to international trade. The US has also slowed shipping through a naval blockade.

Efforts to end the conflict through diplomacy have failed. A 60-day ceasefire expired last week without a settlement.

In describing the sanctions, Bessent said the US was “ending” what he called the Iranian threat, saying America was no longer managing it. Britain’s Chancellor John Healey said the UK supported US work towards a diplomatic solution and welcomed efforts to increase pressure.

Analysts Question Near-Term Impact

Even before China’s response, some analysts said the new measures may not quickly change Iran’s energy revenue.

David Oxley, chief climate and commodities economist at Capital Economics, told the BBC that the direct effect on Iranian oil income would likely be limited in the short term. He cited the fact that about 90% of Iran’s oil goes to China, adding that Beijing has not previously recognised US sanctions on Iran and is unlikely to change.

Ali Vaez, deputy director of the Middle East and North Africa Program at the International Crisis Group, said China generally opposes unilateral sanctions and would only comply with multilateral or international measures. He also said Iran’s neighbours, including Pakistan, Turkey and Iraq, could not afford to sever ties with Tehran despite wanting good relations with Washington.

Other potential affected trading partners, including India and Russia, had not responded to the US announcement at the time of reporting.

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26 August 2026

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China was never going to kowtow to Trump’s latest threats. The statistics alone make that obvious.

When 90% of Iran’s oil goes to China, unilateral sanctions and intimidation simply have no enforcement mechanism.

The real issue for ASEAN is the fallout of higher oil prices, disrupted shipping lanes, and regional economies forced to absorb costs created by Trump's coercive diplomacy. None of that pressure shifts Beijing, but it does hit people here in Asia!

The Strait needs de‑escalation and coordinated management, not another round of Trump brinkmanship that destabilises the Middle East and drags the rest of the world into the economic consequences.